No Good Options, Part One

Over the last 18 months to two years, I have heard people talking about the fact that there are “no good options for them to stay in their homes.” I have heard horror stories about having to deal with the banks on these issues. I have heard about people being so upside down that there was no other choice than to walk away from their home. I have heard that the bureaucratic process to get some relief is impossible to overcome and I have heard that the solutions the government and banks are offering are really no solution at all.

So as a good journalist, I decided to do a little investigating on my own. Wells Fargo holds the mortgage on my home so I decided to call them up and see what my options were to get some relief on my mortgage. Now of course, I can pay mortgage, I have been paying my mortgage, I have never been late, and never missed a payment, but I wanted to find out what people are talking about and what they are going through so I pretended that I needed some help.

First, I went on the Wells Fargo website and obtained the payoff statement on my mortgage. On that site, they ask you if you would like someone from Wells Fargo to contact you about refinance. I said yes. I waited two weeks and no one contacted me. I went back on the site, repeated the process, and waited another two weeks. Still, there was no contact from Wells Fargo. I called their refinance department, waited on hold forever, and in a short amount of time figured out that I would not be able to refinance. Wells was willing to do what they call a streamline refinance with no appraisal. Problem is, they charge you 2.2 percent of the value of your home as a fee that needs to be paid at closing. You cannot roll this cost into the loan and it must be paid in cash at closing. I can tell you that my home is worth about $340,000 so 2.2 percent is about $7,500. The refinance was going to save me $147 dollars a month. Do the math on that! It costs you $7,500 to refinance. You save $147 dollars a month. It takes you four and a half years to get the $7,500 back and then after that, you start saving money. Better yet, I asked the guy on the phone that if I am in financial trouble and need relief on my mortgage, “Do you think I have $7,500 in cash to refinance?” He said, “Probably not.” I told him that was a good guess. So refinancing was out and I asked what he suggested I do next.

Join me next week when we tackle part two of the story. The representative at Wells Fargo suggested that I speak with the Loan Modification Department. You’ll be interested in finding out how that went.

Dan Polimino is a Realtor with Fuller Sotheby’s International Realty. He can be reached at DPolimino@fullerproperties.com and www.coloradodreamhouse.com/denverpost

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